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Grants - FAQs:

What happens if my organization applies for a Federal grant, but is turned down?

There is no guarantee you will receive a grant if you apply. However, if you do not receive a grant, you should try to find out why you did not receive funding and how you could improve a future application. You can follow up with the program officer identified in the announcement. This individual will either be able to provide you with information about your application, or point you to the right person to contact.

In addition, you may be able to obtain written comments on your proposal, which could be a good learning tool. Remember that many organizations compete for Federal funds, and many groups apply several times before they receive an award. Getting feedback on your application can help you improve your chances of receiving funds the next time around.

For information on writing grant proposals, you may want to visit these sites:


Where can I find information on HHS grants and other Federal grant programs?

Grants.gov allows organizations to electronically find and apply for more than $400 billion in Federal grants. Grants.gov is THE single access point for more than 1,000 grant programs offered by all Federal grant making agencies. Be sure to follow the step-by-step instructions for registering on the site. Then you may search for grant opportunities. You may also want to sign up for grant opportunity email alerts

The HHS Grants Information for Current and Prospective HHS Grantees (http://www.hhs.gov/asfr/ogapa/aboutog/grantsnet.html) provides grant management information about HHS programs.


What are some of the legal obligations that are part of receiving a Federal grant?

Financial Reporting Requirements.
To make sure that grant funds are used properly, organizations that receive Federal funds must file regular financial status reports. These forms should not take long to complete, but they are important. The basic financial report form is a one-page document called Standard Form 269. Many agencies have adapted this form to suit their own programs. You can find a copy of Standard Form 269 at http://www.whitehouse.gov/omb/grants/sf269.pdf.

Audit.
All agencies/organizations that receive Federal funds are subject to basic audit requirements, including community and faith-based groups. These audits are intended only to examine the Federally-funded parts of an organization's operations and are not designed to identify unrelated problems. The audits are necessary to make sure that Federal dollars have been spent properly on legitimate costs. It is therefore extremely important for grant recipients to keep accurate records of all transactions conducted with Federal funds.

Most organizations are not audited by the government itself, although the Federal government has the right to audit any program that receives public money at any time. For example, organizations that spend less than $300,000 a year in Federal funds are generally asked only to perform a "self-audit." For larger grants -- those over $300,000 a year -- an audit by a private, independent outside legal or accounting firm is required. More information on audits may be found on the Office of Management and Budget's website (www.whitehouse.gov/omb/circulars).


What kinds of grants are available from the Federal government?

The Federal government uses two kinds of grants:

  • Grants given by an agency of the Federal government (also known as "discretionary" grants) -- for instance, a homeless assistance grant given out by the Department of Health and Human Services to a homeless shelter.
  • Grants that put Federal money in the hands of States, cities, or counties for them to distribute to community groups, charities, and other social service providers, usually under their own rules and regulations (also known as "formula" or "block" grants).

You can apply directly to the Federal government or you can apply for funds from an agency/organization that distributes money it receives from the Federal government. More money is available from programs administered by States and localities than from the Federal government directly.

To search for funding opportunities from the Federal Government, you may want to register and apply through the single source for Federal grants at: Grants.gov.


What will happen if we violate any of the grant rules or requirements specified in the grant?

If you violate the requirements specified in your grant or otherwise improperly use the funds you receive, you may be subject to legal action. Among other things, you may:

  • Lose your grant funds,
  • Be required to repay the funds you received, and
  • Pay any damages that might be awarded through court action.

If an organization uses its funds fraudulently, it could be subject to criminal prosecution.

If you have information regarding a grant fraud specific to HHS, please contact the HHS Fraud Hotline at 1-800-447-8477.

Learn More:


What are the rules on funding religious activity with Federal money?

The United States Supreme Court has said that faith-based organizations may not use direct government support to support "inherently religious" activities. Basically, it means you can not use any part of a direct Federal grant to fund religious worship, instruction, or proselytization. Instead, organizations may use government money only to support the non-religious social services that they provide. Therefore, faith-based organizations that receive direct governmental funds should take steps to separate, in time or location, their inherently religious activities from the government-funded services that they offer.

Such organizations should also carefully account for their use of all government money. This does not mean your organization can't have religious activities. It simply means you can't use taxpayer dollars to fund them. Some faith-based organizations set up separate charitable organizations (so-called "501(c)(3) corporations") to keep programs that receive government money separate from those that engage in inherently religious activities.

This rule of thumb is different if your organization receives Federal money that comes in the form of "vouchers" or other so-called "indirect aid." In simple terms, an indirect aid program is one that gives funds or certificates to individuals in need, which can be used to obtain services from a number of qualified organizations. A good example of indirect aid is a child-care certificate that a parent can use for daycare at any participating child-care center. School vouchers are another example of indirect aid. The vast majority of programs affected by the Faith-Based and Community Initiative involve direct aid to organizations (that is, money that goes directly to the organizations themselves), not vouchers or indirect aid.

Learn more:


What is the difference between Indirect Funding and Direct Funding?

Indirect funding is funding that an organization receives as the result of the genuine and independent private choice of a beneficiary through a voucher, certificate, coupon, or other similar mechanism.

Direct funding is funding that is provided to an organization directly by a governmental entity or intermediate organization that has the same duties as a government entity.


Learn More:
Center for Faith-based & Community Initiatives


Which OMB Circular should I follow related to cost principles?

There are 3 Cost Principle-related OMB circulars, each of which are based on the type of organization receiving grants:


Which OMB Circular covers audits of grant recipients?

OMB Circular A-133 covers audits of States, local governments, and non-profit organizations. Additionally, be sure to review the Compliance Supplement.


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